The Missing $5M: Why Peter Vessenes Belongs in Jail

Hope everyone’s ready to call more bullshit.  Especially you, Peter. We promise you won’t be disappointed by today’s post.

In our last post we gave you the low-down on the CoinLab v MtGox dispute and showed why CoinLab’s MtGox bankruptcy claim is complete bullshit.  This was public knowledge, but it needed a concise summary.  In this post we reveal new information and focus on the USD $5M+ CoinLab owes to MtGox.

Today’s evidence consists of excerpts from internal conversations between members of MtGox’s legal team as they prepared to take on CoinLab in 2013 and early 2014.  We will release more over time as we sift through the material, we don’t want to get innocent people into trouble but creditors have a right to know what’s been going on.

Where is the $5M CoinLab owes MtGox depositors?

TL;DR: CoinLab doesn’t have it because Vessenes took it and blew it on CoinLab’s operating expenses.  The guy belongs in jail and we will fight to put him there if he doesn’t drop his fucking claim ASAP.


Does CoinLab even have the $5M it owes to MtGox customers?  As part of the agreement with MtGox, CoinLab took custody of $5M of MtGox customer deposits. That $5M is a MtGox asset to be divided among creditors.  The trustee asked CoinLab for it and got jackshit.

But CoinLab didn’t shit on everyone.  Some big-name players (CoinLab included) with whom Vessenes would have wanted to maintain a business relationship got cashed out, while the rest of the funds seemed simply unaccounted for:


Balaji Srinivasan of 21 Inc, BitInstant, Coinbase and of course CoinLab all got funds paid out by CoinLab to the tune of USD $1.3M+.  Since the trustee has asked for the full $5M back from CoinLab, the legitimacy of these transfers has clearly been questioned.

Important: we are not claiming any wrongdoing by these names.  We do not know if these were supposed to be genuine MtGox withdrawals, if they have been reconciled with the corresponding MtGox accounts, if these customers also filed claims for those amounts, and so forth.  The bigger concern is why CoinLab moved any funds in any way MtGox was not aware or approved of, considering the concerned tone over where the funds are and whether they even existed anymore.

But there does exist a piece of shit deserving of your rage, Peter Vessenes.  This asshole made sure to file a claim for his own personal MtGox account, as if $175M wasn’t quite shameless enough. 

For those interested in checking the claims list: though the time for challenging claims has passed, we are hopeful that the trustee would still be open to any newly uncovered evidence of a double-dip  Keep investigating.

I recognize the first four names, but who the hell is Jodie Brady?

Jodie is the former CFO of CoinLab.  Why did she leave CoinLab?  Why did Vessenes allow her to get her claim paid back personally?  Jodie wasn’t a big player with a valuable business relationship for Vessenes to maintain, but she had the goods on him and he had to keep her trap shut:


Here we have a MtGox lawyer explaining why Jodie Brady is an is an important witness against Vessenes.  She had the resolve to call bullshit on Vessenes’ “movement of Gox funds” and was rightfully concerned that as CFO she would be called to answer for it. Hence the likely reason she was allowed to pull her funds out with the other bitcoin elite and sent packing for the Rustbelt.

We hope Jodie can come forward and tell her story.  Vessenes is fucking over thousands of people and deserves everything coming to him.  But if she doesn’t, can someone please find this woman?  And if she won’t talk, when the next creditor meeting rolls around let’s make sure the trustee know that we could use a subpoena.

What about the remaining $4M?  Don’t tell me . . .

You guessed it.  The lawyers’ investigation revealed that CoinLab spent all the remaining funds for “its own purposes”.  Yep, it’s gone, folks.  Thank Peter Fucking Vessenes.


MtGox’s lawyers were looking into suing Peter Vessenes individually, which ended up not happening when MtGox went into bankruptcy and all the proceedings were stayed.

We’re not sure whether the trustee would still consider this option.  The trustee’s goal is recovering assets and his focus is in Japan.  It’s unclear whether he would consider pursuing Vessenes if all his assets are in the US.  But Jesus H Christ this needs to fucking happen, somehow.

Holy shit.  Isn’t this criminal?  How can this piece of shit get away with this?

Let’s ask a member of MtGox’s high-paid legal team that question:


Perhaps prosecutors will be more interested in locking up Peter Vessenes now that they can be seen protecting thousands of screwed over Americans who lost money at MtGox instead of protecting a foreign bitcoin exchange’s “unclean hands”.  Yeah, I think that’s probably a bit more compelling.

To our Goxxed brethren on US soil, feel free to drop a line to the US Attorney for the Western District of Washington or Washington state’s Attorney General.   I guarantee we will.

Peter, drop your goddam claim and drop it fast.  If you’re lucky, the trustee will drop his attempt to recoup the five mill you owe us.  You will have still pocketed over four mill minus whatever you invested into your bogus lawsuit.  But if you keep fucking with us we will make sure the noise gets loud enough to have your ass indicted.  



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